Australia’s Perpetual ended talks with KKR about a potential asset sale to the U.S. buyout firm, and will instead look to hold onto its corporate trust unit.

The reality is Perpetual and KKR’s deal died on December 9, when the Australian Taxation Office refused to grant it rollover relief. It meant a $500 million-odd tax bill for Perpetual should it go through with the deal, reducing estimated cash proceeds to Perpetual shareholders by about 40 per cent.

Perpetual Ltd. said it will pursue the sale of its wealth management business after rejecting the latest offer from KKR & Co., as the Australian financial services firm attempts to lure new offers.

Australia's Perpetual Ltd has terminated talks with KKR for the A$2.2 billion ($1.4 billion) sale of its wealth management and corporate trust units and said it would pursue a sale of its wealth management business separately.

The 139-year-old conglomerate had proposed the sale to the private equity giant more than a year ago. It will try to sell wealth management separately.